The asymmetric costs rule

When a party challenges a determination, the Commission will ordinarily rely on the 'asymmetric costs rule' developed by the Court of Appeal in Commerce Commission v Southern Cross Medical Care Society[1] and Air New Zealand Ltd v Commerce Commission[2]. The asymmetry referred to is that the Commission will not normally be exposed to costs if it loses when defending a challenge to a determination, but it can recover its costs against the appellants if it is successful. However, the Commission recognises that in every case the Court has an inherent jurisdiction to award costs as it sees fit.

When does the rule apply?

In determining costs, the asymmetric costs rule can apply as follows:
(a) If the Commission wins in the High Court or subsequently on further appeal it may recover costs from the litigants.
(b) If the Commission loses in the High Court, and has properly and reasonably appeared in the public interest and to assist the Court in determining the issues in the litigation, it is unlikely to be liable for costs to the other parties.
(c) If the Commission has taken and lost any further appeal against a High Court decision, it will be susceptible to an award of costs to the other parties in the same way as any litigant (but these costs will not include High Court costs).

The application of the rule and the resolution of costs will depend on the facts in each case.

The rule does not automatically extend to judicial review applications or other kinds of litigation involving the Commission.

[1] [2004] 1 NZLR 491 (CA).
[2] [2007] 2 NZLR 494 (CA).